Text 19

• Read the text about two international retailing companies. Do the tasks below.

Managing international retailing

Among international retailers, two have set the pace: Ikea, the Swedish furniture chain, and Toys "R" Us, the US toy retailer. They have built up worldwide networks - Ikea in 28 countries, Toys "R" Us in 26 - of giant stores which have killed competition from local rivals.

Ikea is opening 12 new stores a year in cities including Frankfurt, Shanghai, Chicago, and Wroclaw in Poland. A committee of senior executives at the group's international headquarters in Denmark oversees investment in new markets and the redesigning or expansion of existing stores.

Responsibility for product development and purchasing lies with Ikea of Sweden, the original company that pioneered the 'blond' style of Scandinavian furniture and furnishings which has gained a huge international following.

A third layer of country managers tailors the presentation and marketing of those products in their home territories. Country managers usually assume control for day-to-day activities only when there are more than two stores in their region. They are allowed some flexibility in choosing additional products which they think will meet local tastes.

At Toys "R" Us, by comparison, the fickle nature of children's choices requires more latitude for local managers. Toy tastes vary significantly between different cultures, says Greg Staley, President of the company's international division. For example, Asian families like educational toys, while American children are heavily influenced by Saturday morning television programmes. Some toys, such as Barbie dolls and Lego building sets, do well everywhere. But others are less predictable.

Headquarters decides whether to open a new store but local managers take all the day-to-day decisions on what toys to buy and in what quantities; how to market them, and how much to spend on advertising. 'We really do give them great latitude in the management of their business,' says Mr Staley.

1. Mark the sentences true or false, according to the information in the text.

1. Both Ikea and Toys "R" Us are strongly competitive in local markets around the world.

2. Ikea and Toys "R" Us have the same management structure for their international network.

3. Ikea's international headquarters are in Sweden.

4. Children in different countries like different kinds of toys.

5. Toys "R" Us local managers have more decision-making powers than Ikea local managers.

6. Ikea's country managers have more control when they are in charge of more than two stores in the same region.

2. Find the best explanation for each of these words and phrases as used in the text.

1. have set the pace

a) have been slow to expand

b) have taken a lot of risks

c) have provided a good example for others

d) have been in competition with each other 2. tailors

a) takes full responsibility for

b) creates ideas for

c) carries out

d) adapts or modifies

3. fickle

a) unpredictable

b) expensive

c) limited

d) unchanging

4. latitude

a) restrictions

b) assistance

c) freedom

d) guidance